BHA Executive Says Renewable Energy Initiatives Needed

Wednesday, 28 October 2009 19:28
BHA News Editor

The Bahamas needs "to move faster" on renewable energy initiatives and programmes designed to reduce electricity costs, business leaders said yesterday, arguing that import duty exemptions to facilitate efficiency in the sector were not having the desired effect because complementary equipment was still being heavily taxed.

Frank Comito, the Bahamas Hotel Association's (BHA) executive vice-president, said one such case was CFL or energy efficient light bulbs, upon which the Government had eliminated all import duties in the last Budget.

However, these bulbs were now incorporated as part of energy efficient fixtures, he explained, and since these fixtures were still subject to relatively high import/customs duty rates, the value of the exemptions for the bulbs was being eliminated.

And, in turn, businesses and residential users were being discouraged from purchasing energy efficient technology because of the cost involved, and importers turned away from bringing the products in.

"We'd like it to move faster than it has. We wish they were moving faster," Mr Comito said of the Government's efforts to reduce energy costs and enhance efficiency, which have involved a search a for renewable energy suppliers and the drafting of an initial National Energy Policy.

"Last July, with the passage of the Budget in June, there was a recommendation enacted that we in the BHA had been making for years, to make CFL (fluorescent light bulbs), energy efficient light bulbs, duty free," Mr Comito explained.

But while this was welcome, the Government failed to adjust or eliminate the import duty rates on "energy efficient fixtures", and "many bulbs are now part of the fixture". This, the BHA executive vice-president suggested, showed the need for a more comprehensive, considered tax policy to ensure that renewable, sustainable energy - plus energy efficiency and conservation - were encouraged in the Bahamas.

"Our sense is that there needs to be a 'roll up the sleeves' approach to policy at a different level," Mr Comito said yesterday. "There are a number of categories of equipment that could be considered for duty exemptions that are not going into the mix. It should be part of the overall National Energy Policy that is under consideration."

The BHA executive vice-president, speaking yesterday at a conference to unveil the 2009 Energy Conference and Business Trade Show, an initiative it is staging in partnership with the Chamber of Commerce and the US Embassy in Nassau, also pushed for public policy changes that would allow net metering in the Bahamas.

Mr Comito explained that this would allow businesses and residential users "to create excess energy from their own [renewable] systems, and the excess energy would go back to the [BEC] power grid".

Those who sold excess energy to BEC would then receive a credit on their energy bills, reducing their utility costs. Mr Comito said US states, such as California, had used net metering very successfully to produce "a real impact" on energy costs, usage and the development of sustainable, renewable energy.

Jeff Dubel, the US Embassay's political/economic chief, said the absence of net metering in the Bahamas was also suffocating efforts by developers to incorporate renewable energy and associated technologies in their projects.

He explained that many developers spoken to by the US Embassy wanted to embrace sustainable energy technologies in their businesses, but in the absence of net metering in the Bahamas - where they could sell excess electricity back to the BEC grid - they were unable to earn a return on this investment. Without net metering, the initial costs incurred in installing renewable energies was just too prohibitive.

Arguing that the Government "urgently" needed to remove legislative and technical impediments to Bahamas-based businesses implementing renewable energy technologies and their own power sources, Yvette Sands, head of the Bahamas Chamber of Commerce's energy and environment committee, said electricity costs were at a point where they "impeded" business.

"I think we're at the point now where it's becoming an impediment to doing business, not allowing businesses to implement renewable energy offerings," she said. "Businesses are willing, but policy does not allow it."

Referring to the fact that existing legislation does not permit companies and homeowners to use alternative energy in areas where BEC's electricity supply is present, Ms Sands added: "Policy needs to open the gate to allow this to happen. We need to have legislative relief for the improvements to occur.

"Businesses are primed and ready, but the environment does not allow for it. The pace needs to quicken on getting rid of impediments, either legislative or mechanical. There are some technical issues that need to be solved. We do want to see it go a little bit faster."

Ms Sands acknowledged that "all is not lost", with the Government working on numerous energy-related initiatives with the Inter-American Development Bank (IDB), including the importation of 100,000 CFL light bulbs for low and middle income families, plus 30 pilot programmes featuring solar PV technology and net metering, plus 70 pilot solar water heater installations.

However, she added that the process of gathering data, writing reports, discussing them and then taking action could take between three to five, even 10 years, a process that needed to be drastically shortened.

Addressing the press conference, Ms Sands said: "We need cleaner energy at stable prices. It is urgent. The time is now.

"The outcry of the business community is loud and it continues to ring in our ears. The cost of electricity is too high to be sustained, the law does not allow for any significant private generation of power to relieve the burden, there is no room for a fast-paced response by businesses to reduce their energy bill.

"Bearing such a bill has been tough to most and devastating to others - the electricity bill is one of the most burdensome costs a business will bear. For some, passing it on to consumers is the only option short of shuttering their business. The result - the cost of living goes up and up, because of the fluctuating world fuel price."

Ms Sands said the Bahamas needed to reduce its dependency on fossil fuels to lower its carbon footprint and environmental impact, and integrate renewable energy into the mix while also reducing consumption and power demand.

"Businesses need to take a hard look at their consumption, and some of the things they can do to reduce consumption short of self-generation of power," Ms Sands added. "Look at the tools that are available, and find ways to reduce consumption to mitigate against prices going up." She warned that renewable energy forms might not always be "the panacea" for every situation.

Mr Comito added that it was not enough to demand that policies and institutions be in place on the Government side. "Not enough businesses are aware of the opportunities that present themselves," he added. "We can't be knocking the public sector if businesses are not taking advantage of the opportunities."